Bryans Corporation has provided the following data for its two most recent years of operation: Selling price per unit $ 53 Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials $ 13 Direct labor $ 6 Variable manufacturing overhead $ 5 Fixed manufacturing overhead per year $ 63,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold $ 4 Fixed selling and administrative expense per year $ 71,000 Year 1 Year 2 Units in beginning inventory 0 3,000 Units produced 9,000 7,000 Units sold 6,000 7,000 Units in ending inventory 3,000 3,0000 The unit product cost under variable costing in Year 1 is closest to: $31.00 $28.00 $24.00 $35.00
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
| Selling price per unit | $ | 53 |
| Variable manufacturing cost per unit produced: | ||
| Direct materials | $ | 13 |
| Direct labor | $ | 6 |
| Variable manufacturing overhead | $ | 5 |
| Fixed manufacturing overhead per year | $ | 63,000 |
| Selling and administrative expenses: | ||
| Variable selling and administrative expense per unit sold | $ | 4 |
| Fixed selling and administrative expense per year | $ | 71,000 |
| Year 1 | Year 2 | ||
| Units in beginning inventory | 0 | 3,000 | |
| Units produced | 9,000 | 7,000 | |
| Units sold | 6,000 | 7,000 | |
| Units in ending inventory | 3,000 | 3,0000 |
The unit product cost under variable costing in Year 1 is closest to:
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$31.00
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$28.00
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$24.00
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$35.00
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